Startups > Gusto

Gusto

Gusto helps SMBs automate payroll, benefits, and HR administration.

Series E $746M total Founded 2012 United States

Gusto is a cloud-based payroll, benefits, and HR software platform designed for small and medium-sized businesses. It automates payroll processing, tax filing, benefits administration, and employee onboarding while simplifying workflows that were traditionally manual and error-prone. The platform saves businesses approximately $1,800 annually in payroll and HR administration costs and is known for its user-friendly interface compared to legacy systems like ADP.

Problem solved

Small business owners and HR teams spend excessive time on manual payroll calculations, tax compliance, and benefits administration with outdated, complicated systems.

Target customer

Small and medium-sized businesses (typically 1-500 employees) seeking to simplify payroll processing and HR administration without technical complexity.

Website LinkedIn Crunchbase

Founders

Joshua Reeves

CEO & Co-Founder

Electrical engineering graduate from Stanford; previously co-founded Acclivity, which was acquired by Intuit.

Edward Kim

Co-Founder & Head of Technology

Product manager at Google, consultant at Bain & Company; previously founded PicWing and zenpayroll.com.

Tomer London

Co-Founder & Chief Product Officer

Engineering background; co-founded Etacts, which was acquired by Intuit.

Aziz Qureshi

Co-Founder

Funding history

Seed $6.1M December 11, 2012 Led by Unknown · Y Combinator

Series C $140M July 31, 2018 Led by T. Rowe Price · General Catalyst

Series D $200M July 2019 Led by Dragoneer Investment Group · CapitalG, T. Rowe Price, Fidelity

Series E $175M October 26, 2021 Led by Unknown · T. Rowe Price, Fidelity

Tender Offer $200M+ June 2025 Led by Ontario Teachers' Pension Plan (Teachers' Venture Growth) · Unknown

Total raised: $746M

Industries

Employee Benefits Enterprise Software Financial Services FinTech Human Resources SaaS

Pricing

Tiered SaaS model: Simple plan $49/month base + $6 per employee/month; Plus plan $80/month base + $12 per employee/month; Premium plan $180/month base + $22 per employee/month. Contractor-only plan starts free for 6 months, then $35/month + $6 per contractor. All plans include unlimited payroll runs, automatic tax filings, and compliance support. No hidden fees.

Integrations

Applicant tracking software integrations, 401(k) plan integrations, HSA/FSA/commuter benefits modules

Website

gusto.com/

Competitors

ADP

Legacy competitor known for complicated contracts and surprise charges; Gusto offers transparent pricing and modern UX.

Paychex

Traditional payroll provider; Gusto is cloud-native with integrated HR and benefits administration in single platform.

Workday

Enterprise-focused HR suite; Gusto targets SMBs with simplified workflows and lower cost of implementation.

Why this matters: Gusto has achieved a $9.3B valuation and raised $746M+ by simplifying a traditionally complex, high-friction market (payroll/HR) dominated by legacy players. The company demonstrates strong product-market fit with SMBs and is notable for its founder pedigree (prior exits to Intuit) and ability to attract top-tier institutional investors like T. Rowe Price and Dragoneer.

Best for: Small to mid-size businesses (1-500 employees) that want to eliminate manual payroll administration and compliance headaches without complex implementations.

Use cases

Payroll Automation for Growing Startups

A 50-person startup switches from manual spreadsheet payroll to Gusto. After initial setup, each pay period requires only entering hours worked and bonuses—the system automatically calculates taxes, deductions, and generates payments. Year-end tax forms (W-2s, 1099s) are generated automatically.

Compliance and Tax Filing

A small retail business with hourly employees uses Gusto to automatically file federal, state, and local payroll taxes. The business maintains compliance with current regulations without needing to hire a payroll specialist or bookkeeper.

Benefits Administration and Employee Onboarding

A professional services firm uses Gusto to offer health benefits, workers' compensation, and 401(k) plans to employees. New hires complete onboarding digitally—signing documents and accessing benefits information through the platform.

Alternatives

Wave Free accounting and payroll software; lacks enterprise-grade benefits administration and support.

Square Payroll Best for Square users; less comprehensive HR and benefits features than Gusto's integrated suite.

Rippling Broader IT and device management platform; more suitable for tech-forward companies needing endpoint management alongside payroll.

FAQ

What does Gusto do? +

Gusto is a cloud-based payroll, benefits, and HR platform for small and medium-sized businesses. It automates payroll processing, tax filing, benefits administration, employee onboarding, and compliance. The platform handles salaried, hourly, and contract workers with support for health insurance, 401(k)s, HSAs, FSAs, and workers' compensation.

How much does Gusto cost? +

Pricing starts at $49/month base + $6 per employee/month for the Simple plan. The Plus plan is $80/month base + $12 per employee/month. Premium plan is $180/month base + $22 per employee/month. All plans include unlimited payroll runs, automatic tax filing, and compliance support. A Contractor-Only plan is also available.

What are alternatives to Gusto? +

ADP and Paychex are legacy competitors focused more on payroll; Rippling offers broader IT management alongside payroll; Wave provides free accounting and payroll but with fewer benefits features; Square Payroll integrates with Square's ecosystem.

Who uses Gusto? +

Target customers are small and medium-sized businesses with 1-500 employees looking to simplify payroll and HR. Common users include startups, professional services firms, retail businesses, and small office operations. Specific notable customers are not publicly disclosed.

How does Gusto compare to ADP? +

Gusto offers modern, user-friendly cloud software with transparent pricing and no hidden fees, whereas ADP is known for complex contracts and opaque pricing. Gusto integrates payroll, benefits, and HR in one unified platform, while ADP maintains separate modules. Gusto is better suited for SMBs; ADP targets larger enterprises.